Retailers Expect Glitzy Christmas, Despite Supply Chain Snarls

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From Neiman Marcus to Macy’s and Home Depot, several major retailers expect to see shoppers pulling out all the stops at gatherings after Covid-19 kept them socially distanced last year.

“After being limited by Covid-19 restrictions, people want to travel, spend more time out enjoying outdoor activities, express themselves and above all live and share experiences,” Remo Ruffini, Moncler’s Chairman and CEO, said.

Many consumers are entering the holiday season with more disposable income, having saved up during lockdown and as economic rebound puts money in their hands. The Dow Jones Industrial Average hit record highs this week, while London’s FTSE 100 index marked its highest close in 20 months.

“We’ve noticed a party theme,” added Macarena Blanco, fashion editor of Heuritech, a data firm analysing about 30,000 pictures a day on social media, mainly Instagram and TikTok.

Yet retailers are up against a supply chain crisis that has left them scrambling to stock enough sparkling wine, tinsel, scented candles and partywear, among other things. In addition, the new AY.4.2 “Delta Plus” coronavirus variant looms, after causing some concern in the United Kingdom.

“One of the big trends that we’re seeing across the board is maximalism, which is really about ‘more is better’ and more opulence – it’s embracing colours and embracing patterns,” Sarah Fishburne, Home Depot’s director of trend and design, said. But in September, Home Depot during its quarterly earnings call said “raw material shortages, production constraints and pressures across modes of transportation are creating a difficult supply chain environment.”

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Rival Lowe’s echoed this in October, saying second-quarter inventory was US$ 17.3 billion, down US$ 1.1 billion from the first quarter. Nonetheless, Bill Boltz, head of merchandising at Lowe’s, said: “Shoppers will want to go big this season … We’re expanding our selections. As an example, this year we will have a larger offering of artificial trees over 8 feet for those looking to fill a larger room.”

US department store Nordstrom recently blasted customers with an email urging them to “go full-on glam in sequins, metallics and more” and “dress to impress,” saying “tis the season to sparkle.”

But the previous week, the retailer alerted customers about global supply chain challenges and shipping delays, warning that the “hottest gifts may sell out on our site and that shipping could take longer than we’d all like.”

Festive fashion apparel has already been selling out, according to market intelligence platform Edited, which notes a 236% increase in full-priced garments selling out between July and October this year, globally, which has led fewer options for consumers shopping online in the United States – about half compared with the same time last year.

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Macy’s is banking on its customers picking up metallic bags and shoes, velvet blazers and pearls among a string of fancy partywear. The company is among several retailers that have been forced to invest heavily in shoring up their supply chains to bring these products into the country.

Macy’s said it is using multiple ports to reduce congestion, running its fulfillment centres 24/7, partnering with shipping giant Maersk to efficiently pull product out of ports, and hiring more than 20,000 additional fulfillment centre workers.

Designers are drawing on glitzy textiles, with sequins, for example, with references to the Nineties and the party scene at the onset of the year 2000, noted Heuritech’s Blanco. The firm identified a rise in trends like glitter boots, which are up 15% in the United States from last year, and feathers, up 42%, for the end-of-year season.

Lana Todorovich, president and chief merchandising officer of Neiman Marcus, described the emergence of “dramatic and unapologetic style” from consumers heading into the holiday season, citing the popularity of pieces embellished with sequins and feathers from labels like Balmain and Tom Ford.

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Global designer clothing sales are expected to be US$ 90.16 billion, up 11.6% from last year but still about US$ 10 billion lower than in 2019, prior to the Covid-19 pandemic, according to Euromonitor.

Mindful of the risk of running low on stocks, Meghan Fabulous, an apparel manufacturer drawing on production sites in India, China and Los Angeles, purchased more green and red festivewear for the upcoming season than last year, and currently has some 10,000 dresses “floating on container ships in the Pacific Ocean” as of early November. Chief Executive Steve Dunlap said he’s concerned they won’t arrive before January. “That’s my nightmare scenario. They’ll sell, but most of them will sit there until holiday season 2022 if that happens.”

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